Newsome v. Young Supply Co.

• Decision Date: 11 June 2012
• Docket Number: Case No. 11–10149.
• Citation: 873 F.Supp.2d 872
• Parties: James NEWSOME, Plaintiff, v. YOUNG SUPPLY CO., et al., Defendants.
• Court: U.S. District Court — Eastern District of Michigan

873 F.Supp.2d 872

James NEWSOME, Plaintiff,

v.YOUNG SUPPLY CO., et al., Defendants.

Case No. 11–10149.

United States District Court,

E.D. Michigan,

Northern Division.

June 11, 2012.

Joey S. Niskar, The Niskar Law Firm, PLLC, Bingham Farms, MI, for Defendants.

ORDER GRANTING DEFENDANTS' MOTION TO AMEND AND CERTIFY ORDER FOR INTERLOCUTORY APPEAL AND STAYING PROCEEDINGS PENDING DETERMINATION OF APPEAL

THOMAS L. LUDINGTON, District Judge.

Plaintiff James Newsome brought this action under the Family & Medical Leave Act (“FMLA”), 29 U.S.C. § 2601, et seq., alleging that Young Supply Company, Staffing Source Personnel, Inc. d/b/a Driver Source, Inc., and Driver Source, Inc. (collectively, “Defendants”) violated his job restoration rights under the FMLA when they refused to restore his original job position as a truck driver, or an equivalent position required by the FMLA. ECF No. 1. In lieu of filing an answer to the complaint, Defendants filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), or alternatively for summary judgment pursuant to Federal Rule of Civil Procedure 56. ECF No. 6. The Court entered an order construing Defendants' motion as one for summary judgment, and permitting the parties to engage in limited discovery regarding whether Defendants have 50 or more employees within a 75 mile radius of Plaintiff's worksite. ECF No. 10.

Defendants admit that they each employed 50 or more employees, ECF No. 6 at 4–5, that they were both “joint employers” of Plaintiff within the meaning of the FMLA, id. at 6, n. 5, that Staffing Source, whose primary place of business is located in Dearborn, Michigan, was the primary employer within this joint employment enterprise, id., and that if Staffing Source's facility is deemed to be Plaintiff's “work site” under the joint employment enterprise, Defendants are liable to Plaintiff under the FMLA, id. at 3, 5.

Defendants, however, challenged the authority of 29 C.F.R. § 825.111(a)(3) (1995), which is the Department of Labor regulation establishing Staffing Source's facility as Plaintiff's work site for purposes of determining whether the 50 employee/75 mile coverage exclusion applies, as an invalid exercise of the Department's rule-making authority under Chevron U.S.A. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). Defendants also claim that a regulation not applicable to joint employmententerprises, 29 CFR § 825.111(a)(2), is controlling and dictates that Plaintiff's work site is Young Supply Company's Saginaw facility. Finally, Defendants allege that if 29 C.F.R. § 825.111(a)(3) (1995) is deemed valid by Harbert v. Healthcare Servs. Group, Inc., 391 F.3d 1140 (10th Cir.2004), cert. denied546 U.S. 822, 126 S.Ct. 356, 163 L.Ed.2d 65 (2005), the amended version of that regulation, 29 C.F.R. § 825.111(a)(3) (2009), which did not take effect until after Plaintiff had already invoked his rights under the FMLA and commenced his leave, should be retroactively applied to this case to bar coverage under the FMLA.

On December 15, 2011, the Court entered an opinion and order denying Defendants' motion for summary judgment. 835 F.Supp.2d 406 (E.D.Mich.2011). Under the rules of statutory construction, the Court afforded Chevron deference to 29 C.F.R. § 825.111(a)(3) (1995), and held that Plaintiff's “worksite” under the FMLA was Staffing Source's office in Dearborn, Michigan. The Court also declined giving retroactive effect to the new version of § 825.111(a)(3) because the retroactive application of amendments to regulations is disfavored. See Woodward v. Dep't of Justice, 598 F.3d 1311 (Fed.Cir.2010).

Defendants now request amendment of the Court's prior opinion and order to certify the order for interlocutory appeal and stay the proceedings pending determination of the appeal. ECF No. 17.

I. Facts

Staffing Source Personnel, Inc. (“Staffing Source”) ¹, is an employee leasing company which provides employees to its customers. Young Supply Company is a customer of Staffing Source. The contract between Staffing Source and Young Supply Company states that employees such as plaintiff “are at all times acting and performing the services to [Young Supply Company] as employees of Driver Source.” ECF No. 13 Ex. A ¶ I. The contract further provides that Staffing Source “will direct and control employees in all matters including hiring, termination, and discipline and shall establish wages, salaries, benefits, bonuses and advancements.” Id. In addition, Staffing Source “shall maintain full and direct control over Driver Source personnel in regard to employee law matters, compensation, workers compensation and all indirect employment matters of the Driver Source employees leased to [Young Supply Company].” Id. ¶ II. Staffing Source likewise paid plaintiff his wages. ECF No. 13 Ex. B.

Plaintiff was hired by Staffing Source in October of 2002 to work as a truck driver. Nine months later, Staffing Source assigned Plaintiff to work for defendant, Young Supply Company, as a truck driver. In September of 2008 Plaintiff provided notice to Defendants of his need for a medical leave of absence in order to undergo surgery in January of 2009. Defendants concede that plaintiff's medical condition constituted a “serious health condition” under the FMLA. ECF No. 6. at 5. Plaintiff commenced his leave of absence on January 12, 2009. At the completion of his medical leave of absence, Defendants refused to reinstate Plaintiff into his original job position, or an equivalent job position.

II. Standard of Review

28 U.S.C. § 1292(b) provides that when a district judge is of the opinion that a civil action order that is not otherwise appealable involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order. The Court of Appeals, which would have jurisdiction of such an appeal may, in its discretion, permit an appeal to be taken from the order if application is made to it within ten days after the entry of the order. The application for an interlocutory appeal is not to act as a stay of proceedings in the district court unless the district judge or the Court of Appeals so orders.

III. Discussion

Defendants request that the Court to certify for interlocutory appeal the December 15, 2011 opinion and order denying Defendants' motion for summary judgment. Because the parties stipulated to the facts essential to the motion, the issue presented was purely one of legal interpretation concerning the validity and applicability of the regulations having to do with whether and when employers will be considered to have 50 employees within 75 miles of Plaintiff's worksite in a FMLA case. This Court is the first Defendants are aware of to engage the legal question at issue since Harbert and the Sixth Circuit has yet to address it.

Defendants contend that the later revision of 29 C.F.R. § 825.111(a)(3) to comport with the Harbert decision speaks to the Secretary of Labor's belief that Harbert was correctly decided and that the new regulation should apply with equal force whether or not the employee had a fixed worksite. As this Court noted, the issue presents a “very close question.” 835 F.Supp.2d at 415. Thus, Defendants submit that a substantial ground for a difference of opinion exists here, and the questions presented are particularly appropriate for interlocutory review. Finally, Defendants believe that certification of these controlling questions of law will materially advance the ultimate resolution of this litigation, because should the Court of Appeals reverse this Court's order regarding either of the two questions presented for interlocutory review, the litigation would terminate before either party expends substantial time and resources on discovery and trial preparations.

In federal courts, a request for interlocutory appeal of a non-final order takes the form of a Motion to Certify an Order for Interlocutory Appeal. See, e.g., Hammer v. Occupational Environmental Medicine, Inc., 2005 U.S. Dist. LEXIS 26861, 6 n. 1 (E.D.Tenn.2005); Am. Beverage Ass'n v. Snyder, 2011 WL 2960190, at *3–4, 2011 U.S. Dist. LEXIS 78789, at *10 (W.D.Mich.). There are three criteria to guide a court's decision to grant a certification for interlocutory appeal: (1) whether the order involves a controlling question of law; (2) whether that question involves substantial ground for difference of opinion; and (3) whether an immediate appeal from the order may materially advance the ultimate termination of the litigation. Laborers' Pension Trust Fund—Detroit and Vicinity v. Rocwall Co., 2008 WL 619206, *2, 2008 U.S. Dist. LEXIS 16722, *4–5 (E.D.Mich.2008) (quoting In re Baker & Getty Financial Services, Inc., 954 F.2d 1169, 1172 (6th Cir.1992)). “[M]ixed questions of fact and law are treated as questions of law for purposes of an interlocutory appeal.” Flint v. Ky. Dep't of Corr., 270 F.3d 340, 346 (6th Cir.2001) (citing Williams v. Mehra, 186 F.3d 685, 690 (6th Cir.1999)).

A. Controlling Question of Law

The Sixth Circuit has also set a low bar for a determination that a question of law is “controlling” in the context of a motion for certification under § 1292(b). “All that must be shown in order for a question to be ‘controlling’ is that resolution of the issue on appeal could materially affect the outcome of the litigation in the district court.” Eagan v. CSX Transportation, Inc., 294 F.Supp.2d 911, 915 (E.D.Mich.2003) (citing Baker, 954 F.2d 1169, 1172 n. 8 (6th Cir.1992)) (quotations omitted).

In its order, the Court noted that “the text of the FMLA provides for an ‘exclusion’ to coverage under the Act: If the employer employs less than 50 employees at the employee's ‘worksite,’ or within 75 miles of the employee's ‘worksite.’ 29 U.S.C. § 2611(2)(B)(ii).” 835...